When someone else assigns power of attorney to you, you become the “attorney-in-fact”. You are held to the highest level of duty to protect the account holder’s funds, to avoid any conflicts of interest, and to avoid any self dealing. It is an honor to be trusted with the responsibility but it can also be stressful to manage another’s financial affairs.
Protecting the Attorney-in-Fact
If you are asked to assume the power of attorney responsibility, it is wise for you to keep very detailed records about how money is spent and why. Clear instructions from the account holder can also be helpful in directing the attorney in fact so there is no question about what is a legitimate expense and what is not.
All assets of the account holder should be kept separate from the accounts of the attorney-in-fact. Mingling funds can create questions later. It is best if you, as attorney-in-fact, use the principal’s own checks to pay for her bills and her credit cards rather than pay on her behalf and later have to write a check to yourself for reimbursement. Clearly separating all financial transactions is the best protection from questions of improper dealing.
Getting Legal Help
Experienced Elder Law Attorney Elga Goodman understands the challenges involved in protecting aging relatives and help you find resources and make a plan to help the people you love. Contact us today at today at 973-841-5111.
Posted in: Estate Planning, New York Estate Planning